More thoughts on Option Trading & Position update

I have few great conversations with few of my readers over the week and I would like to share my thoughts here. I will also provide an update on my existing positions; 1 outstanding XLE and few trades opened yesterday while I was sleeping.

Q: Your live trades seems to show a guaranteed profit, if I follow your trades, I will never lose money?
LOTr: This is not 100% true. While the method that I use does show a higher probability of success, we can’t rule out the fact that we will never lose money. When I enter a trade, the probability of winning should be around 60%. If I repair a trade, I can increase the probability of success (profit or breakeven) to 80-90%. This also means that 10-20% will be a losing trades no matter what from statistical perspective.

Q: Is it recommended to follow your live trades?
LOTr: It depends. If you are already an option trader, it should be a good reference for you, in terms of idea and execution. If you have not traded option before, you may want to learn the basic prior jumping into it. I would consider to video record on how to execute option strategy trades for beginner.

Q: Option trading is difficult!
LOTr: It is not difficult if you follow step by step to learn. The beauty of option trading is that it enables flexibility and creativity. There are many ways of trading options depending on your perspective of the market. I will put up some materials in a more structure way for beginners.

Update on my current position:-

1. XLE – I neither close nor repair this position. It is still live and there are 9 DTE. I will act accordingly depending on technical analysis.

2. AMZN, LNKD & WYNN – These 3 positions were opened yesterday night. I will show detail and screenshot in my next post.